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31 Jan, 2008

Published: 08:01 Thursday 31 January 2008
By: Charlie Parker, Investment Editor

The chief executive of F&C Investments Alain Grisay has said he is confident the firm can continue as a standalone business as Friends Provident sells its majority stake.

Shares in the asset manager fell slightly on the news, dropping 1% to 188p by 8.30am.

Though Friends has said it is exploring every option to release its stake in F&C it has also said it wants the matter resolved by the Summer.

Grisay told Citywire that he has appointed Lazard and Lexicon Partners to advise it on the change in ownership. Grisay said that all options, including a management buy out, would be explored but that it was too early to say whether finance could be achieved for this move.

The news comes as the firm discloses its asset under management figures which while showing a tail off in overall assets under management from £104.1 billion to £103.6 billion show resilience in its higher margin UK retail business

He said: 'We have appointed advisers to make sure all solutions are explored. Morale is incredibly strong and there is a strong belief in the three year plan, the continuation of that plan will be the driving force.'

His comments came minutes after Friends Provident (FP.) said it is selling the business which it believes is no longer central to its objectives.

Grisay also said that the assets F&C Investments (FCAM) runs for Friends Provident, which account for 30.4% of its assets under management, or 13% of its revenue, will continue to be managed on a contractual basis. The contract is automatically triggered by the change of ownership and lasts for seven years.

The executive chairman of Friends Provident Adrian Montague has said that this contract is secure and he is pleased with F&C's performance in recent years.

Grisay said: 'Let me say from the outset that at F&C we see this change as a way to open up new opportunities. Friends Provident has been clear that it recognises the need to work with the board and management of F&C to achieve their new strategy objective and will not be rushed into a disorderly process.

'Asset management is a people business so working with F&C is vital to maximise the value of the assets in F&C which is a separate listed business.

'We believe F&C has excellent prospects as a standalone company. Over the last year we have delivered strong investment performance across products and executed a significant number of new products launches and begun extending our reach.'

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